AMARILLO, Texas (KAMR/KCIT) — On Friday, Amarillo Mayor Ginger Nelson defended the city council’s recent decision to issue tax and revenue notes to pay for the Civic Center project, saying moving quickly will save taxpayers money.
On Tuesday, May 24, the Amarillo City Council voted to approve an ordinance authorizing and issuing $260 million in tax and revenue notes to fund the Amarillo Civic Center project.
The move came after voters rejected a bond proposition for the Civic Center project in November of 2020.
“A lot has changed in the last 18 months. A lot of information has come about that I think presents a different environment than what was there,” Mayor Nelson said on Friday. “When we last voted on this, we had a lot of uncertainty about COVID. We didn’t know if we would be able to have large meeting events, you know. But now, we have a vaccine and we’re meeting in person, and we’re meeting in big groups. So that uncertainty is taken away.”
Mayor Nelson said the council’s 4-1 decision to move forward with issuing tax and revenue notes was the best business decision available.
“The building has real construction needs, real repair needs. The longer we wait to make those repairs, the more it costs us because construction costs are going up and interest rates are going up and the more it costs us because we continue to lose opportunities to host events and to bring entertainment to Amarillo,” she said. “The Fed has already signaled in the next 18 months, they’re gonna go up maybe 11 times. So this is just the environment that we’re in and I don’t see another way to do it, that it doesn’t end up costing us a lot more money.”
According to Nelson, the bottom line from taxpayers is Amarillo needs to project and wants to pay as little as possible for it.
She said once the council saw the Garfield report on key findings and recommendations for the Civic Center project, they felt a sense of urgency to act quickly.
“The process always involved a debt issuance by the city and so there are different ways that the city can issue debt. Again, the urgency involved here is really what drives choosing that mechanism, because that mechanism is the quickest result to the issuance of the money,” she said.
At $260 million for the project, Nelson said it was of the utmost importance to lock down the interest rate that was secured by the City after the vote.
“I know there was a request for two more weeks,” Mayor Nelson said, recalling Councilmember Cole Stanley’s stance on the ordinance. “What does two more weeks benefit us toward the project? We know what the need is. We know the project needs to be done. Two more weeks actually just puts us at risk that our interest rate will go up. If it goes up one point, that’s $15 million.”
Mayor Nelson said the funding mechanism they chose moves the project forward.
“And it does the two pieces that will accomplish the most financially for the city, reducing the subsidy on what it takes to operate the Civic Center, and attracting more tourism to the community so that we’re generating more sales tax, more hotel occupancy tax and that’s good for our local businesses, too.”
She said new revenue from expanding the Civic Center will give taxpayers a return on their investment.
“That new revenue will be in front of City Councils in the future for them to decide where it goes,” said Nelson. “They can absolutely put it toward the debt. They can put it toward further expansion projects at the Civic Center. It’ll be their decision.”
On Friday, Mayor Nelson said an architect had already started the design phase. The City will then move forward with the bidding process. She said once the bid process is done, they will start construction, which should take about three years in total.
As MyHighPlains.com reported earlier this week, Amarillo businessman Alex Fairly has filed a suit against the city, claiming the council’s decision to issue those tax and revenue notes violates the rights of Amarillo citizens. He is also seeking injunctive relief.
While the City of Amarillo and Mayor Nelson have not commented on the lawsuit, she did respond to claims that issuing tax and revenue notes is illegal.
“Using tax notes in this situation is a lawful option and we wouldn’t consider anything that wasn’t a lawful option,” she said.